KeNo's Housing and Economic Portal

Sunday, September 25, 2011

Monday September 26 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

More Clues Of A Mega Mortgage Refinance Plan On The Way - (www.businessinsider.com) There were three important developments in mega mortgage refinancing story in the past week. Clearly there is something in the works. The questions are, “What?” and “How big?” This first sign came from the Presidents’ speech. He spoke of a ReFi. But he had not one word of detail. Still there are clues:

· My administration can and will take some steps to improve our competitiveness on our own.

· We’re going to work with federal housing agencies to help more people refinance their mortgages at interest rates that are now near 4 percent.

· I know you guys must be for this, because that’s a step that can put more than $2,000 a year in a family’s pocket, and give a lift to an economy still burdened by the drop in housing prices.

King of the road: The value of a vintage travel trailer - (www.sfgate.com) Not long after coming to terms with the fact that we couldn't afford to buy a home in the Bay Area, and struggling with the decision about whether to move elsewhere, my wife and I settled on a third option: We decided to buy an old camping trailer. A trailer, we reasoned, would be our unique foray into "home" ownership. It would also provide us with an economical way to explore places to live outside of the Bay Area while paying for campgrounds instead of hotel rooms. When we weren't camping, we planned to use the trailer as an office and a guestroom on the side of our house. And maybe, sometime in the future, we could even spend a few months on the road in the camper, exploring the country with our young daughter. Unbeknownst to us, we were part of a trend. A report presented at the Recreational Vehicle Industry Association conference in June found RV ownership in the U.S. at an all-time high with 8.5 percent of U.S. households owning RVs. By comparison, that figure was 6.8 percent in 1993. (The fastest growth in the most recent study was in travel trailers, versus motor homes and other types of RVs).

Generation of houseowners stuck in first houses - (www.sacbee.com) Poor families.... NOT!!! What the fuck did you think you were buying, a loaf of bread???

They're trapped, like so many members of their generation. Steve and Tasha McLaughlin have had two kids since they bought their two-bedroom "Brady Bunch"-style house in South Natomas seven years ago. They need more room, but they can't move: The house they bought for $256,000 is worth just $90,000, and an attempt to sell it failed. "We are literally stuck," said Tasha McLaughlin, 33. "There's no light ahead." The McLaughlins and tens of thousands of others like them in the Sacramento region are unable to take the traditional second step on the American home ownership ladder. They are captive to outsized mortgages born in a real estate bubble, which have balances much higher than the homes are now worth. During the boom years, young families could sell their first homes to buy larger ones, using the equity they built up in their starter models. But for those who bought at the height of the market, plunging prices have wiped out their equity and then some.

Housing refinance proposal unfair to most houseowners - (www.and renters!) - (www.thehill.com) The plan reportedly supported by the Obama administration to force Fannie Mae and Freddie Mac to reduce interest rates for millions of homeowners would mean that some homeowners get government help while their more responsible neighbors do not. It would in effect be a backdoor stimulus, one involving pushing taxpayer cash out the door without a vote of Congress. And there is little reason to think it would be much more effective than the fiscal stimulus to date. The proposal is to strong arm Fannie and Freddie’s independent regulator into allowing the two government-controlled mortgage insurance firms to weaken refinancing guidelines. Millions of homeowners who remain current on their mortgages but do not qualify for a loan under more rigorous post-bubble standards could see their interest rate reduced from, say, 6 percent down to 4 percent. This amounts to a $366 monthly saving on a $300,000 mortgage. Advocates of the idea note that taxpayers are already on the hook for losses because Fannie and Freddie back the mortgages in questions. But the suggestion that the policy is then “free” is off the mark because taxpayers will pay for part of the lower interest rates. The government doesn’t just guarantee mortgages; taxpayers actually own many of them through mortgage-backed securities purchased by the Federal Reserve, Fannie and Freddie.

The Fed’s Wall Street Rescue Missed Main Street - (www.nytimes.com) FOR the last three years we have been told repeatedly by government officials that funneling hundreds of billions of dollars to large and teetering banks during the credit crisis was necessary to save the financial system, and beneficial to Main Street. But this has been a hard sell to an increasingly skeptical public. As Henry M. Paulson Jr., the former Treasury secretary, told the Financial Crisis Inquiry Commission back in May 2010, “I was never able to explain to the American people in a way in which they understood it why these rescues were for them and for their benefit, not for Wall Street.” The American people were right to question Mr. Paulson’s pitch, as it turns out. And that became clearer than ever last week when Bloomberg News published fresh and disturbing details about the crisis-era bailouts.

OTHER STORIES:

US housing market needs renovation - (www.financialstandard.com.au)

English housing market set for a chilly autumn - (www.guardian.co.uk)

Deploying Corporate Cash - (www.ritholtz.com)

Wealthy Should Give Their Tax Cuts to Charity, Millionaire Says - (www.wsj.com)

Rail Traffic Still Consistent With Stagnant Growth - (www.pragcap.com)

Words of wisdom from someone who predicted end of housing boom - (www.miamiherald.com)

Australian house prices drift lower amid muted buyer interest - (www.smh.com.au)

Australian new house sales tank again - (www.macrobusiness.com.au)

U.S. housing market stuck in slump - (www.winnipegfreepress.com)

The Financial Storm Brewing - (www.greatdepression2006.blogspot.com)

Saturday, September 24, 2011

Sunday September 25 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Renters pose as owners, steal house-equity cash - (www.ocregister.com) Authorities have arrested seven people, including some in the United States illegally, on suspicion of posing as owners of at least 20 homes they were renting, taking out $5.9 million in home-equity loans and pocketing the cash. The suspects, some of whom are Korean and Chinese nationals, reportedly stole the homeowners’ identities to conduct the transactions, authorities said. One of the suspects is believed to be a resident of Garden Grove, Los Angeles County Sheriff’s Detective Christopher Derry said. Two of the targeted homes were in Orange County: a five-bedroom house on Spartan Street in Mission Viejo and a four-bedroom house on Threewoods Lane in Fullerton, he said. A loan for $200,000 was taken out on the Mission Viejo home, and one for $250,000 was taken out on the Fullerton home, Derry said. The rest of the homes are in Los Angeles and San Bernardino counties. Individual law enforcement agencies had been working on their respective cases for a while and had recently begun cooperating, Derry said.

Foreclosure Pipeline in NY is 693 months and 621 Months in NJ - (Mish at globaleconomicanalysis.blogspot.com) The Bad News

· Average Loan in Foreclosure Is Delinquent for Record 599 Days

· Of the nearly 1.9 million loans that are 90 or more days delinquent but not yet in foreclosure, 42 percent have not made a payment in more than a year with an average delinquency of 397 days, also a new record.

· As of the end of June, 4.1 million loans were either 90 or more days delinquent or in foreclosure, as delinquencies remain two times and foreclosures eight times pre-crisis levels.

· On average, at the current rate of foreclosure sales, judicial foreclosure states would require 111 months to work through inventories of loans that are 90 or more days delinquent or in foreclosure as compared to non-judicial states, which would be able to clear the inventories in approximately 32 months.

· Most of the foreclosure “outflow” is back into delinquency

· Loans deteriorating over 90 days still outnumber foreclosure starts 2:1

· Foreclosure starts outnumber sales by a factor of almost 3:1

Reverse Mortgages: Do the Benefits Outweigh the Risks? - (www.dailyfinance.com) There are no income or credit requirements, and the loan has no monthly payment. Instead, the lender pays the homeowner, and the reverse mortgage balance rises as a result, accruing interest and fees. Lenders get repaid when the owner either moves or dies, and the home is sold. HECMs are insured by the Federal Housing Administration, so if for the sale price of the home falls short of the loan amount, FHA pays the lender the difference. "Reverse mortgages are full of pitfalls and they are very expensive -- but they are very valuable to the people for whom they work," says Margot Saunders, at counsel with the NCLC. "If you are sitting on a mortgage and you can afford to make payments on it, and have home equity and other assets, this is probably not a good idea. But if you are 85 years old and have $250 a month in income and a $500,000 house, it's a great idea no matter how much it costs, because the lender will give you money you don't otherwise have."

The Massive CEO Rewards for Tax Dodging - (www.www.ips-dc.org) By the same token, corporations don't dodge taxes. People do. The people who run corporations. And these people — America's CEOs — are reaping awesomely lavish rewards for the tax dodging they have their corporations do. In fact, corporate tax dodging has gone so out of control that 25 major U.S. corporations last year paid their chief executives more than they paid Uncle Sam in federal income taxes. This year's Institute for Policy Studies Executive Excess report, our 18th annual, explores the intersection between CEO pay and aggressive corporate tax dodging. We researched the 100 U.S. corporations that shelled out the most last year in CEO compensation. At 25 of these corporate giants, we found, the bill for chief executive compensation actually ran higher than the company's entire federal corporate income tax bill. Corporate outlays for CEO compensation — despite the lingering Great Recession — are rising. Employment levels have barely rebounded from their recessionary lows. Top executive pay levels, by contrast, have rebounded nearly all the way back from their pre-recession levels.

A Close Look At The Motives Behind The Solyndra Raid - (www.businessinsider.com) In any Chapter 11 filing the senior lenders have preference. This means that if there are any liquidation proceeds Senior Creditors get their money back first. It is important to note that those same senior lenders have significant influence regarding how the company’s assets are disposed of. In the case of Solyndra, the senior lender is also the largest equity owner, Argonaut Ventures, an investment vehicle controlled by George Kaiser. Argonaut got the preferential position when it agreed to make a $75mm term loan to Solyndra back in February of 2011. Note: DOE representatives participated in the structuring of the Argonaut term loan. The DOE specifically granted the preferred position. Six months ago the good folks at the DOE had to have known that Solyndra was a sinking ship. If we later hear that either the DOE or the President were shocked and surprised that Solyndra went into the tank, then we know they are lying. In the layer cake of creditors the highest tier is the DIP (Debtor in Possession). This loan is only granted after a chapter filing. It is approved by the court and as a result stands first in line. The DIP lender has significant sway in the timing and the manner of assets sales. Not surprisingly, the proposed provider of the DIP is Argonaut. (The deal calls for a 15% rate and an $80,000 front end fee. Not bad for a four-week loan)

OTHER STORIES:

The Two-Tier Housing Market - (www.theatlantic.com)

Annual Inflation hits 4% as measured by MIT - (www.mit.edu)

Chicago Fed backs more easing - (www.marketwatch.com)

2009 bear rally knife catchers consistently overprice their homes - (www.irvinehousingblog.com)

Housing market: Foreclosures to the rescue! - (www.cnn.com)

Shadow inventory Armageddon - (www.doctorhousingbubble.com)

A Conversation With a House "Owner" - (www.youtube.com)

A Huge Housing Bargain — but Not for You! Why not? - (www.solari.com)

Preventing housing bubbles - (www.macrobusiness.com.au)

Australian housing falls accelerate - (www.macrobusiness.com.au)

S&P Rates Subprime Mortgages Higher Than US - (www.bloomberg.com)

Friday, September 23, 2011

Saturday September 24 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

SOLYNDRA SCANDAL ROLLS ON: Feds Raid Homes Of CEO & Founder Of Obama-Backed Solar Company - (www.businessinsider.com) FBI agents raided the homes of Solyndra CEO Brian Harrison and company founder Chris Gronet Friday, iWatch News reports, as the investigation into the company's questionable federal loan threatens to ensnare the Obama administration. The Department of Energy fast-tracked the company's loan request under its green jobs program — and Obama visited the company last year. ABC News reported earlier today that members of the Obama administration were allowed to sit in on company board meetings as observers. Solyndra filed for bankruptcy protection last week, laying off 1,100 employees and leaving taxpayers on the hook for over $500 million.

PHILIP GREENSPUN: Obama Wants To Pay The Unemployed To Play Xbox For 151 Weeks - (www.businessinsider.com) Let’s try to come up a list of things that a person, effectively taught, could do in 99 weeks. Here’s a start:

earn most or all of a bachelor’s degree if done at an efficient school such as University of Phoenix where courses are self-paced and/or in session all year rather than the lazy half-the-year calendar of a legacy university

· earn an MBA (1 year at a modern school; 2 years at a legacy school)

· become a competent video editor in Final Cut or Adobe Premiere (two weeks?)

· become a competent photo editor in Adobe Photoshop or The Gimp (two weeks?)

· develop reasonably fluency in a foreign language, even without an instructor, using tools such as RosettaStone (one year, possibly including a trip to Guatemala or China or wherever)

· start and finish an aviation maintenance degree and FAA certification (typically about 1.5 years)

· learn heavy equipment operation

· complete almost any trade school, e.g., plumbing or electrician

· go from zero computer knowledge to being a Microsoft Certified Systems Engineer or a Cisco network engineer

It seems strange to pay someone for 99 weeks and hope that somehow the employers that didn’t want them when they were fresh out of work would somehow want them after two years of idleness.

What about the following modifications to the system:

· for people who live in states with an unemployment rate higher than average (see http://www.bls.gov/web/laus/laumstrk.htm for the rates), offer a lump sum at the end of 12 weeks to assist the person in moving to a state with a lower-than-average rate

· for people who’ve been unemployed for 12 weeks, simply pay for a year of education in programs with proven records of skills-building (I guess you measure by how many finished and were able to get jobs)

I have heard that there are various government training subsidies available, but none seem to be as well funded as the river of money that is going into the 99-weeks-of-Xbox system.

BofA discussing about 40,000 job cuts: report - (www.reuters.com) Bank of America Corp officials have discussed slashing roughly 40,000 jobs during the first wave of a restructuring, the Wall Street Journal said, citing people familiar with the plans. The number of job cuts are not final and could change. The restructuring aims to reduce the bank's workforce of 280,000 over a period of years, the Journal said. BofA could not immediately be reached for comment by Reuters outside regular U.S. business hours. The Journal said BofA executives met Thursday at Charlotte, North Carolina, where the bank is headquartered, and will gather again Friday to make final decisions on the reductions, putting the finishing touches on five months of work. Investors are pressing BofA to improve its performance after it lost money in four of the last six quarters and its stock has fallen by half this year. The Journal said the proposed job cuts may exceed BofA's last big cutback in 2008 when it called for 30,000 to 35,000 job cuts over three years.

SEC close to deal in Fannie, Freddie case: report - (www.reuters.com) Regulators are close to an agreement with Fannie Mae and Freddie Mac to settle a case over disclosing their exposure to risky subprime loans, The New York Times reported on Thursday. Neither a monetary penalty nor an admission fraud would be included in the settlement under the proposed agreement with the Securities and Exchange Commission, the Times reported, citing several people briefed on the case. The SEC abandoned hopes of assessing a fine because of the precarious financial positions of the two companies, the newspaper said, citing sources who spoke on condition of anonymity because the deal was not yet final. The two companies did not view the government's case as particularly strong, but they said they moved to settle to spare time and resources, the Times said, citing one person close to the talks. The negotiations have been going on since at least early summer, and a deal may not come until later this year, the newspaper said, citing its sources.

Global bondholders to decide on Greek swap offer - (www.reuters.com) Investors in Greek government debt worldwide will tell regulators on Friday whether and how they will participate in a bond swap aimed at giving Athens more time to emerge from a debt crisis, with officials expecting a take-up of about 70 percent. Athens gave banks and insurers in 57 countries until September 9 to say whether they intend to take its debt exchange offer, a key part of a second 109 billion euro bailout package it clinched at a July 21 euro zone summit to avoid bankruptcy. "September 9 is the cutoff date and it is very likely that we may have a bigger response rate as bond holders rush on the last day," a source close to the procedure said on condition of anonymity. Greece had threatened to cancel the deal unless it got 90 percent participation, which would see 135 billion euros ($189 billion) of its outstanding bonds maturing by 2020 swapped or rolled over in a global transaction it wants to conclude next month.

OTHER STORIES:

Stark steps down from European Central Bank - (www.marketwatch.com)

ECB's Stark to leave over bond-buying row: sources - (www.reuters.com)

China Inflation Eases From Three-Year High, Giving Room for Pause on Rates - (www.bloomberg.com)

Germany’s Inflation Slowed Less Than Forecast in August on Energy Rebound - (www.bloomberg.com)

U.K. Producer Prices Rise Least in a Year - (www.bloomberg.com)

Japan Economy Shrinks More Than Estimated - (www.bloomberg.com)

Obama Offers $447B Spending, Tax-Cut Plan to Spur Jobs - (www.bloomberg.com)

Fed Chairman Bernanke quietly takes the heat - (www.washingtonpost.com)

Obama announces $447 billion plan to boost economy - (www.washingtonpost.com)

World policymakers see darkening outlook - (www.reuters.com)

Thursday, September 22, 2011

Friday September 23 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Greek Credit Swaps Surge to Record, Signal 91% Chance Nation Will Default - (www.bloomberg.com) Credit-default swaps on Greek government debt surged to a record, signaling a 91 percent chance the nation will fail to meet debt commitments, after its economy shrank more than previously reported. Five-year contracts on the country’s sovereign bonds jumped 196 basis points to 3,001 basis points, at 3:45 p.m. in London, according to CMA, which is owned by CME Group Inc. and compiles prices quoted by dealers in the privately negotiated market. Gross domestic product shrank 7.3 percent from a year earlier after declining 8.1 percent on an annual basis in the first quarter, the Hellenic Statistical Authority said. Greece’s financial situation is “on a knife’s edge,” German Finance Minister Wolfgang Schaeuble told lawmakers last night, according to parliament’s HIB bulletin.

FBI Raids Bankrupt Solyndra as Lawmakers Question Panel Maker’s Finances - (www.bloomberg.com) The FBI raided the headquarters of Solyndra LLC, the solar-panel maker that failed after receiving $535 million in loan guarantees from the Obama administration. Republican lawmakers said after the raid that the administration made misleading claims about the company’s prospects, and Democrats said the company’s chief executive officer withheld information on its financial plight. The Energy Department gave the Fremont, California-based company the most federal backing awarded a solar manufacturer. One of the principal investors in Solyndra is a foundation headed by billionaire George Kaiser, a campaign supporter of President Barack Obama who made 16 visits to the president’s aides since 2009, according to White House visitor logs. The Federal Bureau of Investigation executed a search warrant today with the Energy Department’s inspector general, bureau spokeswoman Julie Sohn said in an interview. Sohn said she couldn’t provide details about the investigation. Solyndra filed for bankruptcy protection on Sept. 6 with liabilities of $783.8 million, after shutting its factory and firing 1,100 people.

Moynihan Tries to Keep BofA Intact - (www.bloomberg.com) Lynch pulled out his BlackBerry and discovered another startling development: a rumor rattling Wall Street that Bank of America might get swept into an involuntary, government-orchestrated rescue by its smaller rival JPMorgan Chase & Co. “This is really getting nuts,” he thought. Lynch, who as the head of enforcement at the Securities and Exchange Commission in the late 1980s brought Ivan Boesky and Michael Milken to heel, knew he’d come under heavy fire when he parachuted into BofA this July. His assignment: Defend against a seemingly endless barrage of multibillion-dollar lawsuits and government investigations concerning defective mortgage-backed bonds manufactured at the height of the real estate bubble. No sooner did one liability bomb explode than it was followed by another. Now Lynch was doing duck-and-cover for real, while the bank’s share price was pounded to within a whisker of $6, down more than 50 percent since Jan. 1.

Greek backsliding sparks euro exit talk - (www.reuters.com) Anger at Greece's failure to meet fiscal targets that are a condition for its international bailout is nearing breaking point in Berlin and other European capitals, with senior politicians now talking openly about the possibility of Athens exiting the euro zone. Horst Seehofer, the head of the Bavarian Christian Social Union (CSU), was the first prominent figure in Germany to suggest publicly that Greece might eventually be forced to leave the 17-nation single currency bloc in an interview in the Bild newspaper on Wednesday. But he was expressing what many lawmakers and ministers in the German capital have been whispering behind closed doors for weeks, according to well-informed sources. German Finance Minister Wolfgang Schaeuble has ramped up his rhetoric since "troika" inspectors from the European Union, International Monetary Fund and European Central Bank suspended talks on payment of a new aid tranche to Greece last week due to backsliding on its deficit targets.

AMERICA TODAY: Inside Lakewood New Jersey's Homeless Tent City - (www.businessinsider.com) Doug Hardman wakes up every morning with a song in his head -- a vague memory of his days on stage. Inside his tepee in the woods outside Lakewood, NJ, at the homeless Tent City, the roosters wake early and the mornings are already cooler. A musician who lost his Florida home in the housing crisis, Hardman says he floats in and out of Tent City, that he's proud of his kids, and misses the life he no longer has. He has a lot of company out here. Click here to see pictures > Tent City made the news recently and while community leader Steven Brigham says the media attention brought in greater donations, it also brought unwanted attention from the local politicians. After battling with the city for years to have access to the public land here, Brigham found a New Jersey lawyer to represent his case pro bono. The attorney, Jeff Wild, argued that the homeless population are part of the public and should therefore have access to public lands. Rather than take the case to court, Lakewood City Council settled, and Brigham signed an agreement to put up no more shelters and allow no more than 70 people to stay. But last winter the community put up three wooden structures to house everyone and keep them warm. "We didn't lose anybody last year," Brigham says, "and nobody got sick." This year could be different. After City Council members saw the shelters on TV, they sent demolition crews in. The walls were torn down around whatever was inside, and meager furnishings were left to the elements.

OTHER STORIES:

Monetary Stimulus Fuels Currency Volatility, RDQ Economics’s Ryding Says- (www.bloomberg.com)

Schaeuble says situation in Greece is "serious" - (www.reuters.com)

Fitch warns of downgrades for China, Japan - (www.reuters.com)

Trichet May Choose Liquidity Over ECB Rate Cut - (www.bloomberg.com)

Corn Crop Shrinking as Hottest Summer Since ’55 Spurs Record Harvest Price- (www.bloomberg.com)

Central Banks Refocus as Inflation Scare Passes - (www.bloomberg.com)

Libor inquiry looks at criminal angle - (www.ft.com)

German Fin Min: Greece Must Comply With Bailout Agreements - (online.wsj.com)

Trichet Says Growth Outlook Worsens in Euro Region as Inflation Risks Wane - (www.bloomberg.com)

Spanish Industrial Output Declines 2.8% - (www.bloomberg.com)

Obama Offers $447B Spending, Tax-Cut Plan to Spur Jobs- (www.bloomberg.com)

Jobless Claims in U.S. Unexpectedly Rose- (www.bloomberg.com)

U.S. Trade Deficit Narrowed in July More Than Forecast, to $44.8 Billion - (www.bloomberg.com)

Bernanke: Fed Will Weigh Stimulus at Next Meeting- (www.bloomberg.com)

Fed Policy Makers Prepare for Action This Month - (www.bloomberg.com)

Rising Fears of Recession - (www.nytimes.com)

Fed Prepares to Act - (online.wsj.com)

Wednesday, September 21, 2011

Thursday September 22 Housing and Economic stories

KeNosHousingPortal.blogspot.com

TOP STORIES:

Why $200bn in US trades are failing each day - (www.ft.com) $200bn is a big number. Yet it is also the number of trades failing to settle on average per day in the US market. The equivalent figure for Europe is unknown – highlighting what some say is a worrying hole in the back office of the world’s financial system. Such so-called settlement fails – where one market party fails to deliver the security or cash it had promised to send to another entity within a specific time frame – rarely garner much attention outside of the back offices of banks and investment firms. But a gradual spike in failures over recent months in crucial liquidity markets such as “repo” is raising concerns among some market participants. This persistence of settlement fails, despite US government actions to deter them, has led some commentators to conclude that banks might be purposefully failing the trades as a way of dealing with financial stress. The concern is that continued high failures could cause instability in the plumbing of the world’s financial system, and sow confusion over who really owns which assets. “Trade settlement is what converts market liquidity into actual cash liquidity for firms and capital markets,” says Fred Sommers, a back office specialist at consulting firm Basis Point Group. “You wouldn’t buy a house and show up on closing day, take title, rent out the house and collect the rent, all before paying. Yet that’s what’s happening every day in the financial system.”

New York prosecutors widen Goldman probe: report - (www.reuters.com) New York prosecutors are widening their investigation into the manner in which Goldman Sachs (GS.N) marketed certain mortgage-linked securities before the financial crisis, the Wall Street Journal reported, citing people familiar with the matter. The Manhattan district attorney's office began its probe into Goldman following the release in April of a U.S. Senate subcommittee report into the causes of the financial crisis, the paper said. The district attorney's office has issued subpoenas to Morgan Stanley (MS.N) and other investors in the deals. The prosecutor's requests to investors, including some hedge funds, concern how Goldman sold the deals, the Journal said. Subpoenas do not indicate wrongdoing. They are formal requests for information and do not necessarily mean charges are forthcoming or likely. A spokeswoman for Manhattan district attorney's office declined to comment on the Journal report to Reuters. A Goldman spokesman declined to comment to the Journal. The bank could not immediately be reached for comment by Reuters outside regular U.S. business hours.

Finland May Abandon Greek Bailout If Collateral Not Granted, Katainen Says - (www.bloomberg.com) Finnish Prime Minister Jyrki Katainen said his country may not contribute to a second Greek bailout package if demands for collateral in exchange for new loans aren’t met. Such an outcome “remains a possibility,” Katainen told reporters after delivering a speech in Helsinki today. “It depends on the collateral issue.” Finland is at the center of a collateral dispute that threatens to stall Greece’s second rescue package and exacerbate Europe’s debt crisis. Katainen had earlier this month pledged to find a model that satisfies the AAA rated nation’s insistence on extra assurances its bailout funds be repaid without putting other euro members or creditors at a disadvantage. “The collateral issue is a small detail in a larger package,” Katainen told reporters. “We’re looking for a solution. But we can’t wait forever, as the issue must be resolved in the next few days.”

U.S. Company Risk Measure Jumps as Europe Evokes ‘08 Comparison - (www.bloomberg.com) A benchmark gauge of U.S. corporate credit risk climbed on concern that Europe’s fiscal imbalances will hurt U.S. debt markets, as bankers cite parallels to the 2008 financial crisis. The Markit CDX North America Investment Grade Index, which investors use to hedge against losses on corporate debt or to speculate on creditworthiness, rose 5.4 basis points from Sept. 2 to a mid-price of 126.4 as of 4:52 p.m. in New York, according to index administrator Markit Group Ltd. The measure is at the highest closing price since reaching a more than one-year high of 126.8 on Aug. 22. The index has increased from 95.8 basis points on Aug. 1 as investor concerns have mounted about the faltering U.S. economic recovery and upheaval in Europe’s government bond markets. The gauge typically rises as investor confidence deteriorates and falls as it improves. Deutsche Bank AG Chief Executive Officer Josef Ackermann said yesterday at a conference in Frankfurtorganized by Euroforum that conditions in the stock and bond markets are reminiscent of three years ago. “It’s a very gloomy market environment right now,” said Rizwan Hussain, a credit strategist at Morgan Stanley in New York. “An ‘08 type of comparison clearly does not bode well.’’

Analysis: Baby boomer fears cast another pall over markets - (www.reuters.com) Even as anxiety over policy inertia, banking and sovereign debt crises dominate the headlines, a long-festering concern over the impact of aging Western populations on stock markets is returning to add even greater gloom. Hopes are dimming for a resolution of the worst ravages of the 2007-2009 credit shock before the mass retirement later this decade of the "baby boom" generation - the outsized population cohort born shortly after World War Two. For many convinced of the long-term power of demographic trends on financial markets, the fuel for ever-rising stock markets is already evaporating fast and a 10-year equity bear market at least is in the offing. These long-held concerns are now critical in a decade where the 79 million U.S. people born between 1946 and 1964 start retiring as soon as this year and larger boomer retirement waves build to peak around 2020-2022.